These actionsaffectwhichcomponentsoffourthquartergdp

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Unformatted text preview: are only two firms in an economy: Cowhide, Inc. produces leather and sells it to Couches, Inc., which produces and sells leather furniture. With each $1,000 of leather that it buys from Cowhide, Inc., Couches, Inc. produces a couch and sells it for $3,000. Neither firm had any inventory at the beginning of 2006. During that year, Cowhide produced enough leather for 20 couches. Couches, Inc. bought 80% of that leather for $16,000 and promised to buy the remaining 20% for $4,000 in 2007. Couches, Inc. produced 16 couches during 2006 and sold each one during that year for $3,000. What was the economy's GDP for the 2006? a. $48,000 b. $52,000 c. $64,000 d. $68,000 Answer: B 15. AnAmericancompanyoperatesafastfoodrestaurantinRomania.Whichofthefollowing statementsisaccurate? i. Thevalueofthegoodsandservicesproducedbytherestaurantis includedinRomanianGDP,butnotinU.S.GDP. ii. Thevalueofthegoodsandservicesproduc...
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This document was uploaded on 03/13/2014 for the course ECO 221 at Miami University.

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